Mid-market sustainability and mitigating large source air emissions

Large source air emissions reduction is a fundamental component for stopping climate change, but for mid-market manufacturers in the US technology-based standards for emissions reduction can appear daunting. For many mid-market businesses, the answer might be found in emerging innovative technologies and practices for mitigating large source emissions while promoting a more manageable control approach.

We’ll explore two key strategies: Carbon Capture, Utilization, and Storage (CCUS), and Combined Heat and Power (CHP), which could play a significant role in reducing emissions and advancing sustainability in mid-market manufacturing industries.

In this article:

• Getting mid-market business over the air emissions hurdle.
• What is Carbon Capture, Utilization, and Storage (CCUS)?
• What is Combined Heat & Power (CHP)?
• The bottom line on mitigating mid-market air emissions.

Getting mid-market business over the air emissions hurdle

As US companies maneuver to predict ESG regulations while determining new strategies for waste minimization the most significant question being asked is: “What’s the bottom line?”

AB Electrolux’s President and CEO, Jonas Samuelson, has gone on record to say that “climate change remains one of the most urgent challenges for society and we all need to accelerate our actions to reach the 1.5-degree ambition set up in the Paris Agreement. Electrolux is committed to become climate neutral in operations by 2030 and across our value chain by 2050.”

The rest of Mr. Samuelson’s quote about the subject, along with many other industry leaders, can be found at Corporate Leaders Group.

It’s easy to expect multi-national, multi-billion-dollar companies to improve their emission controls. But where does that leave the US mid-market manufacturing CEO who knows that environmental and social governance regulations are soon to be in force?

Regulations like the Environmental Protection Agency’s new “Good Neighbor Plan” aims to reduce 70,000 tons of smog-forming nitrogen oxide pollution from industrial facilities by 2026 in 23 states. Additionally, company emissions budgets will reflect a fifty percent reduction from 2021 ozone season NOx emissions levels, as detailed in the Good Neighbor Plan outline. Reducing greenhouse gas emissions from large stationary sources, such as manufacturing facilities or oil extraction sites, is a crucial step towards achieving a sustainable future. CCUS and CHP technologies offer promising, long-term solutions for this concern.

What is Carbon Capture, Utilization, and Storage (CCUS)?

Carbon Capture, Utilization, and Storage (CCUS), as the name implies, is an approach which involves capturing carbon dioxide (CO2) emissions from industrial processes and either utilizing or storing them to prevent their release into the atmosphere.

CCUS offers a dual benefit by not only reducing emissions but also giving an opportunity to reuse them as fuel in the production of building materials.

How it works

1. Capture CO2 emissions from stationary sources such as power plants, cement factories, and refineries. Advanced technologies, including solvent-based absorption, membrane separation, and solid adsorption (the adhesion of particles to help the separation process) are employed to selectively trap CO2 before it’s released into the atmosphere.
2. Once captured, the CO2 can be utilized in various ways, contributing to the circular economy. One notable application is the production of building materials, such as concrete and aggregates. CO2 can be injected into concrete mixtures, where it chemically reacts and mineralizes, effectively sequestering the CO2 and providing strength to the material. This innovative approach not only reduces emissions but also mitigates the carbon footprint of the construction industry.
3. In cases where utilization isn’t immediately feasible, CO2 can be stored underground in geological formations, preventing its release into the atmosphere. These storage sites, known as carbon sinks, can be found in depleted oil and gas fields, saline aquifers, or deep geological formations. By safely storing CO2 underground, this technology significantly contributes to the long-term reduction of greenhouse gas emissions.

There are several US states that encourage the development of carbon capture projects from point sources (e.g., coal and gas fired power/ethanol plants). Once captured, the carbon dioxide (CO2) may be transported via pipeline for geologic storage in a suitable underground rock formation. Injecting CO2 underground prevents its emission to the atmosphere and mitigates climate-change impacts (CCEU).

Benefits to your business

Carbon dioxide enhanced oil recovery (CO2-EOR) is a form of enhanced oil recovery in which captured man-made CO2 is injected into existing oil fields to produce additional oil. CO2-EOR may help offset the costs of carbon capture technology and infrastructure.

CO2-EOR using man-made CO2 can have a net benefit for the climate by storing more CO2 than is produced, including emissions from the use of the oil. State incentives encourage investments in carbon capture projects. This list is intended to demonstrate the range of policy options, although some of these policies have expired or been repealed. Many states offer more than one financial incentive for companies striving to be more energy efficient. Details regarding this incentive can be found on the C2ES website, including the following list of policy options.

• Direct financial assistance: States often structure direct financial assistance to CCS projects and CO2 pipelines as grants or loans.
• Off-take agreements: States may require utilities to enter into off-take agreements with power plants with carbon capture technology. This requirement provides a guaranteed buyer for the electricity.
• Utility cost recovery mechanism: States may authorize utilities to pass on the costs of carbon capture technology to ratepayers. This provides timely reimbursement of costs incurred during construction and operation through favorable rates of return for regulated utilities’ investments.
• Clean energy standard: When a state declares carbon capture technology eligible toward state electricity generation portfolio standards or voluntary goals, utilities can earn saleable compliance credits by generating electricity at power plants with carbon capture technology. Inclusion of carbon capture in portfolio standards or goals may also facilitate approval of utility cost recovery for carbon capture technology, which may be critical for financing projects in states with regulated electricity markets.
• State assumption of long-term liability: When states assume long-term liability related to geologic storage of CO2, it may reduce the long-term costs for private project developers.
• Tax Incentives: States may provide tax credits for CO2-EOR and geologic storage. They may reduce corporate income taxes, provide exemptions from property and sales taxes on CO2-EOR and geologic storage machinery and equipment, and may reduce severance taxes on oil produced through CO2-EOR using man-made CO2.

What is Combined Heat & Power (CHP)?

Combined Heat & Power (CHP), also known as cogeneration, is an energy-efficient process which maximizes energy productivity by utilizing waste heat that would otherwise be wasted in conventional power generation. It’s cost-effective with few placement limitations and can be installed and utilized quickly. CHP is a type of distributed energy production which touts the concurrent production of electricity or mechanical power and useful thermal energy (heating and/or cooling) from a single source of energy as defined by energy.gov. CHP systems offer numerous benefits, including reduced emissions, energy savings, and improved operational efficiency.

How it works

1. Electricity generation: In a CHP system, fuel is combusted to produce electricity using a generator. Simultaneously, waste heat generated during this process is captured and repurposed for various applications, such as space heating, water heating, or industrial processes. By harnessing this waste heat, CHP systems achieve energy savings of up to 40% compared to separate power and heat generation.
2. Emissions reduction: CHP systems significantly reduce emissions by maximizing the use of fuel energy. Traditional power generation relies on separate processes for electricity and heat generation, resulting in significant energy losses and higher emissions. In contrast, CHP systems reduce overall fuel consumption, leading to lower greenhouse gas emissions and a smaller carbon footprint.
3. Operational efficiency: The integration of CHP systems in manufacturing facilities enhances operational efficiency by providing a reliable, decentralized energy source. This on-site power generation reduces transmission losses associated with grid-based electricity and enhances the facility’s resilience during power outages or disruptions.

Benefits to your business

Cogeneration systems have a wide range of industrial applications, from food processing to construction, and even breweries. For a plant to achieve cogeneration, as summarized by Italian Food Tech, certain conditions must be met including:

1. Achieving a primary energy saving (e.g. fuel) compared to alternative solutions (e.g. purchased electricity or electricity produced from a boiler).
2. The most rational thermodynamic process is utilized to convert the potential energy of fuel, thanks to the simultaneous generation of mechanical/electrical and thermal energy.

A simple example of cogeneration would be a power plant that takes residual steam from electricity production — oftentimes utilizing a heat recovery steam generator — and using it to heat buildings.

In the wake of the US Inflation Reduction Act of 2022, the US Department of the Treasury will offer $270 billion in tax incentives to combat climate change. Additional incentives for cogeneration implementation in the US include:

• Investment Tax Credits (ITC): The federal government has, at times, offered Investment Tax Credits for qualified CHP systems. These credits provide a percentage reduction in a company’s tax liability based on the qualified investment in a CHP system.
• Modified Accelerated Cost Recovery System (MACRS): This is a depreciation method that allows businesses to recover the costs of qualifying CHP property over a shorter time frame, providing a financial incentive by reducing taxable income.
• Energy-efficient commercial buildings deduction (Section 179D): This incentive allows building owners to deduct the cost of energy-efficient improvements, including CHP systems, in commercial buildings.
• State and local incentives: Many states offer their own incentives, such as grants, rebates, tax credits, or low-interest loans, to promote energy efficiency and the adoption of CHP systems.
• Utility programs: Some utilities may offer incentives to their commercial and industrial customers for implementing energy-efficient technologies, including CHP systems. These incentives can vary by utility and location.
• Federal and state grants: There have been instances of federal grants aimed at promoting energy efficiency and reducing greenhouse gas emissions. State-level grants and programs may also support CHP projects.
• Renewable Portfolio Standards (RPS) and Renewable Energy Credits (REC): While not specific to CHP, some RPS and REC programs may indirectly benefit CHP projects, especially if the CHP system incorporates renewable energy sources.
• Federal and state funding programs: Occasionally, specific funding programs are launched to support clean energy projects, which could include CHP systems. These programs may be managed by agencies like the Department of Energy (DOE) or other relevant state agencies.
• Environmental benefits: CHP systems can often qualify for emissions reduction credits under certain environmental regulations, providing additional incentives for reducing greenhouse gas emissions.

The bottom line on mitigating mid-market air emissions

It’s important for mid-market manufacturers to understand what their options are for sustainability. When companies leverage governmental support and understand the proper technological advancements available for emissions management, compliance becomes more manageable.

By adopting more sustainable practices, the manufacturing industry will make significant progress in achieving their emissions reduction targets and simultaneously promote a greener and more resource-efficient future. With concerted action and the widespread adoption of these technologies, businesses large and small can pave the way for a more sustainable and climate-resilient world.

At Enhesa, we help your business understand its requirements in all facilities around the world and see where you stand on global compliance in a clear, consistent way. Learn more about our solutions for staying on top of EHS regulations.